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Bank of America Securities continued hemorrhaging equity derivatives staff last week with the resignation of four traders in New York and the departure of Nick Waltner, managing director and head of equity financial products in Tokyo. The move follows the recent departure of six professionals from the New York office to launch a hedge fund (DW, 3/4). Waltner, the four who resigned in New York and the six launching the hedge fund all reported directly or indirectly to Jonathan Sandelman, managing director and global head of equity financial products in New York. Sandelman did not return repeated calls.

Cargill International plans to hire a derivatives-savvy manager for its financial markets group's coal trading operations in Geneva. The company currently trades over-the-counter coal derivatives and is also planning to start physically settling coal derivatives, according to Peter Bishton, head of the power generation team in Geneva. The coal team is currently part of the power generation team. The hire will report to Dave Rogers, president, who is responsible for the company's international trading business. He splits his time between Cobham, U.K., and Geneva and was unavailable for comment.

Solutia, a chemical company in St. Louis with nearly USD3 billion in sales last year, is considering entering an interest-rate swap on the back of a high-yield bond it plans to issue in the next few months. Kevin Wilson, treasurer, said the size of the bond offering has yet to be decided, but predicted it would be no larger than USD300-400 million.

Credit default-swap spreads of London-based aluminum and steel-maker Corus Group tightened roughly 20 basis points last week as initial panic over U.S.-imposed steel tariffs died down slightly and the broader market moved tighter. Mid-market five-year protection was quoted at 400 basis points Thursday, about 20bps tighter than at the beginning of the week. Spreads had widened roughly 50bps the previous week on news of the steel tariff. "Initially the market tried to push it higher, but now it is basically trading flat to where it was [before the tariff was announced]," said one trader. However, he noted Corus and other European steelmakers have underperformed. "The general trend has been for credit to come in, but steel has effectively lagged whilst pretty much everything else--oil, retail, paper and tobacco--has all come in even more," another trader in London added.

James Parascandola, a credit derivatives trader at IntesaBci in New York, has left the firm, according to a firm official. Parascandola, who resigned from the firm about three weeks ago, reported to Paolo Josca, head of credit derivatives in New York.

Deutsche Bank has hired Danielle Merone, a fixed-income derivatives sales professional covering hedge funds at Credit Suisse First Boston, in a similar position in London. She left CSFB in the middle of last week, according to an official at the firm. Merone is on gardening leave and could not be reached.

Deutsche Bank's equity derivatives group in London is structuring a product that will allow discretionary account holders to take on exposure to a basket of listed and privately held water companies, in what is believed to be the first product of its kind. Shachi Shah, v.p. global equity derivatives in London, said the payout will be based on an index of water companies, which her department is currently drawing up. The firm expects to raise approximately EUR100 million (USD88 million) for the product when it goes live within three months. Shah declined all comment on how the product will be structured.

Deutsche Bank is preparing a USD5 billion balance sheet synthetic collateralized debt obligation that is expected to hit the market in May, according to a market official who is familiar with the deal. The product is being structured as a replacement for Deutsche Bank's 1999 Blue Stripe CDO, which has a three-year call that will mature in May.

SwapsWire, an electronic derivatives trading platform owned by 23 dealers, including Morgan Stanley,Credit Suisse First Boston andMerrill Lynch, is set to start brokering over-the-counter derivatives trades next week, according to interest-rate derivatives professionals. Henry Hunter, chief marketing officer at SwapsWire in London, said it has taken since the beginning of last year to develop the platform. Still, "in the realm of complex technology projects it's been a relatively short" gestation period, he added. He said the launch is imminent, but declined to give an exact date. Hunter said SwapsWire will help interest-rate derivatives dealers become more efficient. "We're not looking to significantly change the way business is done, we're looking to make it cheaper and less risky," he said, declining further comment.

One-week U.S. dollar/ Japanese yen implied volatility hovered around 11% Wednesday coming down from its high of 15% a week earlier as last week's surprise yen rally lost steam and investors bought dollar calls/yen puts. The majority of the positions were three-month options with strikes between JPY135 and JPY140. Spot was at JPY129.5 compared to JPY128.6 during the yen's rally a week earlier. Investment banks were the big players in the market. "The major currency pairs have been really subdued. People were taking up short positions and the front end of the curve has really flattened out," said one options trader in New York.

ADIG Investment, a German retail fund manager with EUR27.4 billion (USD24 billion) in assets under management, has structured a guaranteed equity-linked note using an equity put option as the guarantee. The five-year fund is referenced to a basket of global equity indices comprising equal amounts of the Standard & Poor's 500, Dow Jones Euro STOXX 50 and Topix, according to Thomas Heib, head of portfolio insurance in the financial engineering department in Frankfurt. The five-year notes are being targeted to retail investors. "A lot of investors suffered big losses in actively managed sector funds, so there is a trend to get back into the market and to not just bet on one horse but to have the whole market," he said. "The idea is to get investors back into the market" as the global economy appears poised to head higher.

Bear Stearns has hired Bill Bamber, senior v.p. of structured products at HSBC in New York, as an equity derivatives structurer at Bear Stearns in New York. During his stint at HSBC, Bamber reported to Russell Schreiber, fellow senior v.p. of structured products, according to Linda Stryker-Luftig, spokeswoman at HSBC.